Is it time to submit your year-end financials? As a retailer, you understand that you will ultimately want a Year-End Stock Value at your fiscal year end, but might not be aware of reviewing the integrity of your stock information prior to, and/or at, the fiscal year end date.
Why should you perform a physical count?
A proper inventory count often reveals issues that you never knew existed, such as unknown shrinkage and obsolescence.
There are some advantages of a good inventory tracking system, such as:
- Theft control: Physical counts are a great way to validate that sales match order information, and that there are no discrepancies caused by employee or customer theft.
- Better customer service: Getting an accurate picture of what inventory you have on hand helps ensure that you’re able to meet all orders and stock up on items with low numbers.
- Product tracking: Year-end inventory is as good a time as any to look back at the year and evaluate what products are selling well and which ones might be worth dropping going forward.
Remember, It is crucial that you do a physical stock take. If your tax year ends on December 31 (most do) your inventory count needs to be of the product and materials you have on hand.
Sometimes circumstances don’t allow you to count your inventory on December 31. In that case, count your inventory a few days before or a few days after December 31 and adjust your numbers.
Preparing for the Year-End Physical Count
In order to ensure a successful physical count, you need to spend some time in the preparation process before you can begin counting inventory.
To ensure accurate and efficient year-end physical products count, here are seven tips to be successful:
- Choose a date
Selecting a date is important when it comes to planning your physical count. The best time to perform a physical count is when you are closed for business; however, if this is not possible, pick a day or time of day when business is slow and inventory stocks are at their lowest levels. Once you have chosen your date, put it on the calendar and inform your employees.
- Select a method for inventory counting
While some companies still rely on count cards and count sheets, many companies are transitioning to barcode scanners and mobile devices with barcode scanning and inventory counting applications. These methods are by far the easiest and most accurate way to perform an inventory count.
- Invest in all of the necessary equipment and supplies
Depending on the method you choose, you’ll want to make sure that you have all of the appropriate supplies necessary to complete your year-end inventory count on hand. If your company has decided to use mobile devices, you will need to purchase inventory counting apps, such as the ACCEO Smart Vendor mobile inventory management module. If you’ve decided to use wireless barcode scanners, you will need to purchase the devices if you do not already possess them.
- Communicate with the staff
Make sure your employees are aware of the physical count date and the method you’ve chosen. If you are implementing a new inventory counting tool, set up a training day to familiarize them with the new device and software. This will ensure a smooth physical count for everyone.
- Provide written inventory instructions
Be sure that your retail business has written instructions for the physical inventory count. These instructions should be distributed in advance to employees involved in the count, and reviewed with them in advance. Further, maps should be used along with the instructions to assign areas of responsibility.
- Organize before counting
This is one of the most important parts of the planning process. Organized warehouse and store(s) make for a more efficient physical count. As close to the physical count date as possible, instruct your employees to walk through the location and put everything in its proper place.
- Backup, Backup, Backup
Just to be safe, it is always a good idea to backup your data before you begin counting your inventory, again before you apply the inventory count changes, and a third time once the changes have been implemented.
For many retailers, the once a year “Physical Count” is quickly approaching. This is the ideal time to start implementing a mobile inventory management solution to save valuable time and make product count less painful.
Find out how handheld mobile devices and the Mobile inventory module integrated to ACCEO Smart Vendor POS system can benefit your retail store.